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TMI Blog1954 (8) TMI 1X X X X Extracts X X X X X X X X Extracts X X X X ..... ach of these three appeals, the Customs authorities have imposed a penalty exceeding Rs. 1,000/. Their contention is that the penalty they have imposed does not exceed three times the value of the goods and that it is open to them either to impose the penalty which does not exceed three times the value of the goods or which does not exceed Rs. 1,000/-. On the other hand, the contention of the other side is that there is a limitation upon the power of the Customs Authorities with regard to the imposing of the penalty and that limitation is that they cannot impose a penalty which exceeds Rs. 1,000/-. In other words, it is contended that whatever may be the value of the goods, the maximum penalty that the customs authorities can impose is Rs. 1,000/-. 3.This very point came before me for consideration when I was dealing with Criminal Revisional Application No. 1203 of 1951, decided on 14th December 1951. In that case, the Collector of Central Excise had imposed a penalty upon the petitioner in the sum of Rs. 10,000/- under item 8 of the Sec. 167. The petitioner did not pay the penalty. An application was made for enforcing the penalty by the Collector, and the Chief Presidency Magis ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d by me in Criminal Revisional Application No.1203 of 1951. Mr. Justice Tendolkar would have felt himself bound by that decision as it was a judgment of a co-ordinate authority; but he took the view that a recent judgment of the Supreme Court had overruled my decision and therefore he was bound by the Supreme Court decision in preference to the judgment delivered by me. Mr. Justice Tendolkar conceded that the Supreme Court had not actually decided this point; but the view which the learned Judge took was that it was an obiter dictum of the Supreme Court, and, according to the learned Judge, an obiter dictum was as much binding upon him as an express decision given by the Supreme Court. 5.Before we turn to the judgment of the Supreme Court, it is necessary to have our minds clear as to what is an obiter dictum which has a binding effect upon a court. It is rather significant to bear in mind that in England an obiter dictum has no binding effect either upon a co-ordinate Court or upon a subordinate Court. An obiter dictum, especially of an eminent judicial tribunal like the Privy Council or the House of Lords, would undoubtedly be entitled to the highest respect. But a judge in Eng ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e higher tribunal whether the point arose before it or not. Mr. Palkhivala has attempted to make a distinction between an opinion and a definite opinion. He says that, if the higher court says that a certain view may be possible, then it is not a definite expression of opinion, but if the tribunal definitely expresses its opinion, and not merely tentatively, then it is unnecessary for us to consider whether any points arose for determination before the higher authority, and the mere expression of opinion itself, provided it is definite, would become an obiter dictum, and, in India, binding upon the courts if the obiter dictum is that of the Supreme Court. In our opinion, that argument appears to be entirely untenable. The very reason why the Courts in India agreed to be bound by the obiter dicta of the Privy Council was that the highest judicial authority in the Empire had applied its mind to a question of law which arose before it for its determination; and however unnecessary it was for it to decide that question, having expressed an opinion on that point it became an authoritative pronouncement on that question of law, and the Privy Council, by deciding that question of law, set ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... merely persuasive efficacy." 9.Therefore, here also emphasis is put upon the fact that obiter dicta must lay down a rule. It is not sufficient that they should be merely dicta of a superior Court, but from the dicta one must be in a position to deduce a rule laid down by the higher authority. Our High Court has also consistently taken the same view of the obiter dicta of the Privy Council. It would be sufficient to refer to two or three of the recent decisions of this court. The first is Nagappa Balppa v. Ramchandra (1945), 48 Bom. L.R. 225. A Divisional Bench of this court, consisting of Mr. Justice Kania, Acting Chief Justice as he then was, and Mr. Justice Gajendragadkar, were considering certain observations of the Privy Council with regard to Section 83 of the Land Revenue Code, and the question was whether those observations were binding upon the Divisional Bench ; and Mr. Justice Gajendragadkar, at page 237, says this :- "But it is well established that the obiter dicta of their Lordships of the Privy Council are binding on all Courts in India if the said dicta contain a definite expression of their Lordships' opinion vide Shrinivas Sarjerao v. Balwant Venkatesh. Now the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... el at their Lordships' bar and would not have the sanctity of an endorsement of a particular legal position by their Lordships of the Privy Council. The only thing which was pronounced by their Lordships was that such transfer of North Kanara District from the Madras Presidency to the Bombay Presidency for administrative purposes was not sufficient to affect the present law of the residents therein unless and until it was shown in the case of any resident that he intended to change and had in fact changed his personal law. This decision of their Lordships of the Privy Council therefore could not be urged to have set its seal of approval on the position contended for by the protagonists of the Madras school of Hindu Law." Mr. Palkhivala says that this opinion of the Privy Council was based upon a concession made at the Bar. We find it difficult to understand what difference in principle exists between a definite opinion arrived at by the tribunal itself and an opinion based upon a concession made at the Bar. If what Mr. Palkhivala is contending for is that every definite opinion of the Privy Council bound the Court in India, then we have here as much a definite opinion as anywhere ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... bound by this opinion was that we failed to see any observation which the Privy Council had made on the rights of after-born sons with regard to alienations of joint family property. Although this observation was made by the Privy Council, the point was not determined by the Privy Council, and it is clear from that judgment that no arguments were advanced and the Privy Council contended itself with the decision on the question of the nature of the alienation, namely, that legal necessity justified the alienation. 13.Therefore, it would be incorrect to say that every opinion of the Supreme Court would be binding upon the High Courts in India. The only opinion which would be binding would be an opinion expressed on a question that arose for the determination of the Supreme Court, and when though ultimately it might be found that the particular question was not necessary for the decision of the case, even so, if an opinion was expressed by the Supreme Court on that question, then the opinion would be binding upon us. It is from this aspect that we must turn to the decision of the Supreme Court which, it is contended, has overruled the decision to which reference has been made. 14. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... te authorities under the Sea Customs Act to impose a penalty under Section 167 item 8 is limited to Rs. 1,000/-. Now, in the first place it is clear that no question ever arose before the Supreme Court, or could possibly arise, with regard to the interpretation of Section 167 item 8. The only order under Section 167 item 8 was an order of confiscation, and in deciding whether Article 20(2) applied or not the question as to the power of the customs authorities to impose the penalty under Section 167 item 8 was entirely irrelevant. Therefore, with respect, this observation is not an obiter dictum in the sense in which we have indicated. It was not an expression of opinion on a point that arose before the Supreme Court. It is again, with very great respect, a casual observation made in considering the whole scheme of the Sea Customs Act. 16.But there is a further aspect of the matter to which attention must be drawn. When we look at the various items of Section 167, it is clear that some of the items beyond doubt confer the power upon the Customs authorities to impose a fine exceeding Rs. 1,000/-. Take, for instance, item 29 of Section 167. There the power is given to the authoritie ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the true position, it is impossible to understand why the Legislature enacted the first alternative at all. If Mr. Palkhivala's contention is that the maximum penalty that the authorities can impose is Rs. 1,000/-, then it would have been sufficient to provide for the second alternative and it would have been entirely unnecessary to provide for the first. Realising this difficulty Mr. Palkhivala has argued that the proper view that we should take of item 8 is that it must satisfy both the alternatives. In other words, the penalty imposed, must not exceed three times the value of the goods and also it must not exceed Rs. 1,000/-. Now, if we were to accept this contention, we would be converting the "or" used by the Legislature into "and". Whereas the Legislature has advisedly given two alternatives to the Customs authorities, Mr. Palkhivala would ask us to convert the two alternatives into two cumulative conditions which must be satisfied before a penalty could be imposed. There is no warrant whatsoever for changing the clear language of the Legislature. 18.Mr. Palkhivala has very fairly drawn our attention to the English statute : 39 and 40 Victoria, Chapter 36, Section 186, whe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... uch prohibition or restriction, or if any attempt be made so to import or export any such goods, or if any such goods be found in any package produced to any officer of Customs as containing no such goods, or if any such goods, or/and dutiable goods be found either before or after landing or shipment to have been concealed in any manner on board of any vessel within the limits of any port in the States, if any goods, the exportation of which is prohibited or restricted as aforesaid, be brought to any wharf in order to be put on board of any vessel for exportation contrary to such prohibition or restriction", such goods shall be liable to confiscation, and "any person concerned in any such offence shall be liable to a penalty not exceeding three times the value of the goods, or not exceeding one thousand rupees". It is evident from the frame of the section that for a variety of serious infractions of the law the legislature has authorised Customs officers to pass orders for confiscation of goods and also to impose penalties. The penalty which may be imposed may not, however, exceed three times the value of the goods, or may not exceed Rs. 1,000/-. As a matter of plain construction o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n enacting a statute must be found from the words used therein, and in the absence of overriding reasons inherent in the statute the Court would not be justified in adding words thereto. The words of item 8 of Section 167 appear in my judgment to be explicit and there is no obscurity or ambiguity. Nor is there any overriding reason suggested for adding words to the section. The provisions of Section 167 are punitive in character and are intended to operate as deterrent. They are evidently enacted for the protection of public revenue and also in the interest of public health and security, the economy of the State, and for effective control over anti-State activities, and it is difficult to accept the submission that breaches thereof were intended to be published by imposition of penalties which, in the context of the serious infractions penalised thereby in respect of property of considerable value, may be regarded as purely nominal. Again, when it is realised that a serious offence may be committed by importation or exportation or other dealings with prohibited articles, dangerous or noxious in character, of little or no value, the futility of the argument that the penalty to be im ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sition of fine in lieu of confiscation by a Customs officer was prosecution and punishment for an offence which prevented a Magistrate from trying the offender for the offence committed by him under Section 23 of the Foreign Exchange Regulation Act, VII of 1947, and they held that by reason of the proceedings taken for confiscation and the imposition of fine in lieu of confiscation under Section 167(8) read with Section 183 of the Sea Customs Act, the offender could not be regarded as "prosecuted and punished" within the meaning of Article 20(2) of the Constitution, and the Magistrate before whom the proceedings under the Foreign Exchange Regulation Act of 1947 were pending was not deprived of his jurisdiction to try the offender. That conclusion of their Lordships has no bearing on the question to be decided in this appeal. 24.Reliance was, however, sought to be placed upon an observation in the judgment in Maqbool Hussain's case at page 20 of the report, which is as follows :— "Even though the Customs officers are invested with the power of adjudging confiscation, increased rates of duty or penalty, the highest penalty which can be inflicted is Rs. 1,000/-". 25.Now, this ob ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Customs officer cannot exceed Rs. 1,000/- can obviously have no reference to the items which I have mentioned earlier. It cannot be limited to the provisions of item 8 because it refers in terms to imposition of a duty, whereas the penalty clause in item 8 does not contemplate imposition of duty at all. It must, in my view, be held that, when their Lordships made the observation on which reliance has been placed, they were only indicating generally what the scheme of the Act is, and not giving a considered decision either upon the effect of the penalty clause in item 8 of Section 167 or generally upon the effect of the penalty clause in the items of Section 167. The observation, therefore, cannot be regarded as an observation, which would have the effect of an obiter dictum of their Lordships. It need hardly be said that, if the observations were a considered opinion expressed on a question, even if the opinion was not necessary for the ultimate decision of the case before their Lordships of the Supreme Court, we would be bound by that expression of opinion, whatever our view may have been thereon. But in the present case, for reasons already set out, we cannot regard the observati ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... fundamental right of the citizen he may come to this Court even after considerable delay. It may also be argued in such a case that, although the law provides for an alternative remedy, the Court will not refuse to give effect to the fundamental rights which are guaranteed under the Constitution. Therefore, in this particular case, delay might be excused as far as the first ground is concerned. But there can be no justification whatsoever for the gross delay on the second ground. That ground concerns a question of fact, and if this Court can go into that question the appellants should have approached the Court immediately, and not waited for the length of time they have taken. But apart from the question of delay, in our opinion, the appellants are not entitled to ask us to go into that question. The only tribunal, that has been set out by the Sea Customs Act is, first, the Collector who has made the order, and then the appellate tribunal which has been set up under Section 188, and that section in terms provides that every order passed in appeal under this section shall, subject to the power of revision conferred by Section 191, be final. Therefore, what Mr. Jhaveri wants us to do ..... X X X X Extracts X X X X X X X X Extracts X X X X
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